Monday, September 12, 2011

Ricochet Kids


Accordung to the National Endowment for Financial Education, 40 percent of non-student U.S. adults ages 18 to 39 live at home with their parents or have in the recent past. In this down economy, "ricochet kids" have become commonplace.

And while we all want to do whatever we can for our children, especially in these tough financial times, there are conseqences:

A recent NEFE poll found that among parents with adult children living at home:
  • 30 percent have given up privacy
  • 26 percent have taken on debt
  • 13 percent have delayed plans for a major life event, such as getting married, taking a vacation or buying a home
  • 7 percent have delayed retirement

    The NEFE lists these tips for responding to a request from an adult child who wants to move back home:
Understand where your child is coming from. Ask your child why he or she thinks living at home will help him or her toward specific financial goals. Discuss how long he or she plans to live with you, and whether he or she can contribute financially.


Assess your current financial situation If moving your adult child back home means cutting into retirement savings or delaying other financial goals, reconsider how you might help. Offer to watch grandchildren or pets while your child interviews for jobs or works extra shifts. Introduce your son or daughter to professional connections that could lead to job prospects.


Establish ground rules for living under the same roof. Before your child moves in, decide on a move-out date and set guidelines for maintaining privacy and mutual respect. You might consider drawing up a contract, which will show your child you’re serious.


Require your child to contribute, financially or otherwise. Consider charging a small amount of rent or at least having your child help around the house. 


Help your child toward financial independence. Discuss steps your child will take toward getting out on his or her own. Make them specific, and attach deadlines. 


Regularly discuss your child’s progress. Celebrate your child’s accomplishments but hold him or her to his or her end of the deal, whether that includes job-seeking goals, responsibilities around the house or a move-out date.

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